Employment Agreement between InkSure Technologies Inc. and Yaron Meerfeld (COO and Interim CEO)

Summary

This agreement is between InkSure Technologies Inc., a Delaware corporation, and Mr. Yaron Meerfeld, who will serve as Chief Operating Officer and Interim Chief Executive Officer. The contract outlines Mr. Meerfeld’s roles, salary, and benefits, including insurance, educational fund contributions, vacation, and use of a company car. It also requires him to sign a non-disclosure and non-compete agreement. Either party may terminate the agreement with advance written notice—180 days by the employee or 270 days by the company, unless there is justifiable cause for immediate termination.

EX-10.1 2 exhibit_10-1.txt EXHIBIT 10.1 July 1, 2008 EMPLOYMENT AGREEMENT This Employment Agreement (the "Agreement") made and entered into on this day of July 1st, 2008 (the "Effective Date") Between InkSure Technologies Inc, a Delaware corporation (the "Company"), with offices at 1770 N.W. 64th Street, Suite 350, Fort Lauderdale, FL 33309 (hereinafter the "Company"); On the first part And: Mr. Yaron Meerfeld, ID No. 05614338-1, a citizen of Israel, with an address at 3 Yehezkel St. Ramat Gan, Israel (hereinafter the "Employee", and together with the Company: the "Parties") On the second part WHEREAS The Employee has been employed by the Company (and its subsidiaries) pursuant to employment agreements entered into between the Employee and the Company (and its subsidiaries) (Collectively: the "Previous Agreements"), and is currently employed as the Company's Chief Operation Officer ("COO"); and WHEREAS The Employee and the Company wish to amend the terms of their engagement with effect as of the Effective Date and onwards; and WHEREAS The Company is engaged in the development, production and marketing of (i) spectral analysis based machine readable anti-counterfeiting products and (i) synthetic aperture radar based chipless RFID technologies; and WHEREAS The Company has offered that the Employee shall serve, on a interim basis, also as the Company's Interim Chief Executive Officer ("CEO"), in addition to its position as COO, and the Employee agrees to be employed as such, all in accordance with the terms and conditions of this Agreement; Now, therefore, in consideration of the mutual covenants and conditions hereinafter set forth, it is agreed by the parties as follows: 1. PREAMBLE The Preamble to this agreement forms an integral part thereof. 2. POSITION 2.1. The Company shall continue to employ the Employee, and the Employee hereby agrees to continue to serve, as the COO of the Company, and, in addition, the Employee shall serve as the Company's Interim CEO until otherwise decided by the Company's board of directors, all effective as of the Effective Date. 2.2. The Employee shall devote his full business time and efforts to the affairs of the Company, and shall have all the responsibilities and powers that usually apply to the positions held by the Employee, i.e.: as COO and, for the relevant period - also as CEO (in which period he shall also be considered a principal executive officer for purposes of SEC filings). 2.3. While serving as Interim CEO, the Employee shall report to the board of directors, and upon the termination of his office as Interim CEO the Employee shall report to the CEO of the Company. 2.4. The scope of the Employee's position in the Company shall include from time to time, at the Company's sole discretion, rendering the same services stipulated herein, in whole or in part, also to any of the Company's subsidiaries. For the avoidance of any doubt, the parties hereby stipulate that rendering such services as aforesaid shall constitute an integral part of the Employee's position in the Company and shall not entitle the Employee with any right to additional compensation, remuneration or fee whatsoever. It is further agreed, that should the Employee claim for or demand from the Company or any of its subsidiaries any compensation, remuneration or fee for services rendered by him to any of such subsidiaries, the Company shall set-off and reduce the Employee's remuneration under this Agreement with the same amount claimed by the Employee from the subsidiaries. 3. SALARY 3.1. The Company shall pay the Employee a monthly salary of 45,000 IL gross (hereinafter the "Base Salary"), payable each month not later than the second day of the month. The Base Salary will be paid in NIS (New Israeli Shekel). 3.2. The Employee shall be entitled to reimbursement for all expenses incurred by him in the performance of his duties hereunder, pursuant to the Company's prevailing policy for such reimbursements, and in the absence of such established policy - as approved by the Company's board of directors (or its designees), provided that in any case the Employee shall provide the Company with all appropriate receipts. 3.3. The Employee and the Company both acknowledge and agree, that upon the mutual written agreement of the Company and the Employee, the Employee's salary may be paid by either of the subsidiaries on behalf of the Company, but always subject to Section 2.4. The Company further acknowledges that this section 3.3 does not affect the Company's obligation to pay the Employee's Base Salary or benefits pursuant to this Agreement. 4. BENEFITS 4.1. The Company shall pay every month, an amount of 15.83% of the Base Salary to an insurance policy (hereinafter "Bituach Menahalim") in the name of the Employee. The Employee shall pay to such insurance policy, every month, an amount equal to 5% of the Base Salary. - 2 - 4.2. The Company shall pay every month, an amount equal to 7.5% of the Base Salary to an educational fund (hereinafter "Keren Hishtalmut") in the name of the Employee. The Employee shall pay to such fund, every month, an amount equal to 2.5% of the Base Salary. 4.3. The Employee's payments pursuant to sections 4.1 and 4.2 above shall be deducted at source from the Base Salary. 4.4. All taxes due, if any pursuant to section 4.1 and 4.2 above shall be borne and paid by the company. 4.5. Not later than fourteen (14) days after the termination of this agreement, for any cause, the Company shall assign its rights to the Bituach Menahalim and the Keren Hishtalmut to the Employee. 4.6. The Parties hereby adopt the Israeli Labor Ministry warrant from 30.6.98 and declare that the company's payment to the Bituach Menahalim (8.33% for the severance payment) shall constitute the company's whole obligation for severance payments according to section 14 of the severance payment law - 1963 (Israel). 4.7. The Employee shall be entitled to a vacation leave of twenty four (24) days per year, which may be carried forward from year to year. 4.8. The Company shall make available to the Employee a car for his exclusive use during the term of this Agreement. It is agreed that the car will be 2000cc or a car of a similar class. 4.9. The Company shall pay all costs associated with the car, whether fixed or variable, including without limitation, fuel, repairs and insurance including taxation. The Company shall gross all such payments up. 4.10. The Employee shall be entitled to a complete medical checkup once a year. 4.11. The Company shall cause the Employee to be included in its directors and officer's liability insurance, covering customary officers liabilities. 4.12. The Company shall pay all bills for the use of one telephone line installed in the Employee's house, and one cellular telephone used exclusively by the Employee. 4.13. The Employee shall be entitled to Dmey Havra'a as provided in a collective bargaining agreement to which the General Labor Union of the Workers in Israel is a party regarding the payment of Dmey Havra'a that is force and effect. 5. NON DISCLOSURE, COMPETITIVE ACTIVITY AND OWNERSHIP OF INVENTIONS Simultaneously with the signing of this Agreement the Employee shall sign the Non-Disclosure, Unfair Competition and Ownership of Inventions undertaking in favor of the Company and any subsidiary and parent company of the Company, attached hereto as APPENDIX A, WHICH SHALL SURVIVE THE TERMINATION OF THIS AGREEMENT. - 3 - 6. TERM AND TERMINATION 6.1. The Employee may terminate this Agreement for any reason upon one hundred and eighty (180) days' prior written notice, and the Company may terminate this Agreement for any reason upon two hundred and seventy (270) days' prior written notice (each such period being a "Prior Notice Period"), provided, however, that the Company may terminate this Agreement for a "justifiable cause" (as hereinafter defined) without prior notice. During the Prior Notice Period the Employee shall be entitled to payment of the Base Salary and all benefits pursuant to this Agreement. In addition, any unvested options for Company's shares held by the Employee shall continue to vest during the Prior Notice Period. 6.2. "Justifiable Cause" shall mean: (a) conviction of the Employee of a felony which in the Company's view is injurious to the Company; (b) any willful breach by the Employee of his fiduciary duties as an officer of the Company pursuant to court decision; provided, however, that the Company may not terminate the Employee's employment agreement for justifiable cause unless it has given the Employee (i) written notice of the basis for the proposed termination and (ii) if possible, at least fifteen (15) days during which the Employee shall be entitled to cure such basis. 7. MISCELLANEOUS 7.1. This Agreement constitutes the entire understanding between the Parties with respect to the subject matter hereof and with respect to the period as of the Effective Date. Any prior understandings, undertakings or representations with respect to the subject matter hereof, written or oral, shall be of no force or effect. It is hereby clarified that the Previous Agreements shall have no further force or effect for the period as of the Effective Date and onwards. 7.2. This Agreement may be amended only by a document signed by both Parties. 7.3. No rights of any Party shall be prejudiced or restricted by an indulgence or forbearance to any party, and no waiver by any party in respect of any breach shall operate as a waiver in respect to a subsequent breach. 7.4. Any notice, demand, call or request under this Agreement (hereinafter a "Communication") which a Party may desire to serve, or be required to serve upon the other Party, shall be in writing and shall be deemed sufficiently served if: (a) delivered by hand; or (b) if sent by courier that guarantees delivery of such Communication within seventy two (72) hours, addressed to the other Party's address as set forth in the preamble to this Agreement; or (c) sent by facsimile or email with confirmation of receipt. 7.5. The addresses of the Parties for the purpose of this Agreement are as set forth in the preamble to this Agreement. IN WITNESS WHEREOF, The Parties hereunto cause this Agreement to be duly executed. - 4 - INKSURE TECHNOLOGIES INC. /s/ Phil Getter - ------------------- By: Philip Getter Title: Chairman of the Board YARON MEERFLED /s/ Yaron Meerfeld - ------------------- - 5 - APPENDIX A THIS UNDERTAKING ("Undertaking") is entered into as of the 1st day of July, 2008, by Mr. Yaron Meerfeld, ID No. 05614338-1, a citizen of Israel, with an address at 3 Yehezkel St. Ramat Gan, Israel (the "Employee"). WHEREAS Employee has been employed by the Company (and its subsidiaries) pursuant to employment agreements entered into between the Employee and the Company (and its subsidiaries); and WHEREAS the Company and Employee are entering into a new employment agreement as of the date hereof; NOW, THEREFORE, the Employee undertakes and warrants towards the Company and any subsidiary and parent company of the Company as follows: 1. Confidential Information. 1.1. The Employee acknowledges that he has, and will have, access to confidential and proprietary information, including information concerning activities of the Company and any of its parent, subsidiary and affiliated companies, and that he has, and will have, access to technology regarding the product research and development, patents, copyrights, customers (including customer lists), suppliers (including suppliers lists), marketing plans, strategies, forecasts, trade secrets, test results, formulae, processes, data, know-how, improvements, inventions, techniques and products (actual or planned) of the Company and any of its parent, subsidiary and affiliated companies. Such information in any form or media, whether documentary, written, oral or computer generated, shall be deemed to be and referred to herein as "PROPRIETARY INFORMATION". 1.2. During the term of his employment or at any time after termination thereof for any reason, the Employee shall not disclose to any person or entity without the prior consent of the Company any Proprietary Information, whether oral or in writing or in any other form, obtained by the Employee while in the employment of the Company (including, but not limited to, the processes and technologies utilized and to be utilized in the Company's business, the methods and results of the Company's research, technical or financial information, employment terms and conditions of the Employee and other Company employees or any other information or data relating to the business of the Company or any information with respect to any of the Company's customers). 1.3. Proprietary Information shall be deemed to include any and all proprietary information disclosed by or on behalf of the Company irrespective of form, but excluding information that has become a part of the public domain not as a result of a breach of this Undertaking by the Employee. 1.4. The Employee agrees that all memoranda, books, notes, records (contained on any media whatsoever), charts, formulae, specifications, lists and other documents made, compiled, received, held or used by the Employee while in the employment of the Company, concerning the Company or its business (including its trade secrets) (the "MATERIALS"), shall be the Company's sole property and all originals or copies thereof shall be delivered by the Employee to the Company upon termination of the Employee's employment or at any earlier or other time at the request of the Company, without the Employee retaining any copies thereof. - 6 - 2. UNFAIR COMPETITION AND SOLICITATION. The Employee acknowledges that the provisions of this Undertaking are reasonable and necessary to legitimately protect the Company's Proprietary Information, its property (including intellectual property) and its goodwill (the "COMPANY'S MAJOR ASSETS"). The Employee further acknowledges that he has carefully reviewed the provisions of this Undertaking, he fully understands the consequences thereof and he has assessed the respective advantages and disadvantages to him of entering into this Undertaking. In light of the above provisions, the Employee represents and undertakes: 2.1. That during the term of his employment in the Company and for a period of twelve (12) months thereafter, he shall not engage, establish, open or in any manner whatsoever become involved, directly or indirectly, either as an employee, owner, partner, agent, shareholder, director, consultant or otherwise, in any business, occupation, work or any other activity which is reasonably likely to involve or require the use of any of the Company's Major Assets. 2.2. That during the term of his employment in the Company and for a period of twelve (12) months thereafter, he shall not render services similar to his duties as COO or interim CEO of the Company, to any entity or business which competes with the Company or its parent, subsidiary or affiliated companies directly or indirectly. 2.3. That during the term of his employment in the Company and for twelve (12) months thereafter, not to induce any employee of the Company or of any of its parent, subsidiary or affiliated companies to terminate such employee's employment therewith, and that he has not engaged in such solicitation activities since the beginning of his employment in the Company (and any of its parent, subsidiary and affiliated companies). 3. OWNERSHIP OF INVENTIONS. The Employee will notify and disclose to the Company, or any persons designated by it, all information, improvements, inventions, formulae, processes, techniques, know-how and data, whether or not patentable, made or conceived or reduced to practice or learned by the Employee, either alone or jointly with others, since the beginning of his employment in the Company (and any of its parent, subsidiary and affiliated companies) and anytime thereafter (including after hours, on weekends or during vacation time) (all such information, improvements, inventions, formulae, processes, techniques, know-how, and data are hereinafter referred to as the: "INVENTIONS" or "INVENTION") immediately upon discovery, receipt or invention as applicable. In the event that the Employee, for any reason, refrains from delivering the Invention upon grant of notice regarding the Invention, as described above, the Employee shall notify the Company of the Invention and specify in such notice the date in which the Invention shall be delivered to the Company and the reason for delay in such delivery. The Invention shall be delivered as soon as possible thereinafter. Delivery of the notice and the Invention shall be in writing, supplemented with a detailed description of the Invention and the relevant documentation. The Employee agrees that all the Inventions shall be the sole property of the Company, and the Company shall be the sole owner of all patents and other rights in connection with such Inventions. The Employee hereby assigns to the Company any rights the Employee may have or acquire in such Inventions. In order to avoid any doubt, it is hereby clarified that a lack of response from the Company with respect to the notice of the Invention or of its delivery, shall not be considered a waiver of ownership of the Invention, and in any event the Invention shall remain the sole property of the Company. The Employee further agrees as to all such Inventions to assist the Company, or any persons designated by it, in every proper way to obtain and from lime to time enforce such Inventions in any way including by way of patents over such Inventions in any and ail countries, and to that effect the Employee will execute all documents for use in applying for and obtaining patents over and enforcing such Inventions, as the Company may desire, together with any assignments of such Inventions to the Company or persons or entities designated by it. - 7 - The Employee shall not be entitled, with respect to all of the above, to any monetary consideration or any other consideration except as explicitly set forth in its employment agreement, or in any other written agreement or arrangement signed by the Company. With respect to all of the above any, oral understanding, communication or agreement not duly signed by the Company shall be void. 4. GENERAL. 4.1. The Employee acknowledges that the provisions of this Undertaking serve as an integral part of the terms of his employment and reflect the reasonable requirements of the Company in order to protect its legitimate interests with respect to the subject matter hereof. If any provision of this Undertaking (including any sentence, clause or part thereof) shall be adjudicated to be invalid or unenforceable, such provision shall be deemed amended to delete there from the portion thus adjudicated to be invalid or unenforceable, such deletion to apply only with respect to the operation of such provision in the particular jurisdiction in which such adjudication is made. In addition, if any particular provision contained in this undertaking shall for any reason be held to be excessively broad as to duration, geographical scope, activity or subject, it shall be construed by limiting and reducing the scope of such provision so that the provision is enforceable to the fullest extent compatible with applicable law. 4.2. The provisions of this Undertaking shall continue and remain in full force and effect from the beginning of the employment of the Employee in the Company and following the termination such employment relationship for whatever reason. This Undertaking shall not serve in any manner as to derogate from any of the Employee's obligations and liabilities under any applicable law or agreement. Yaron Meerfeld ---------------------------- Name of Employee /s/ Yaron Meerfeld ---------------------------- Signature - 8 -